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Was it six months or a thousand years ago? Louis Freeh, then director of the Federal Bureau of Investigation, sat before a House budget subcommittee, divvying up a wealth of resources. On that May day, Freeh detailed the bureau’s luxurious range of initiatives: cracking down on jewel thieves; neighborhood safe streets programs; combating child pornography, Internet gambling and international sex trafficking. Even then, Freeh feared the bureau was stretched too thin. “I think my successor is going to have to make some choices,” he said. In the wake of an unprecedented terrorist attack on America, that time has come. The Bush administration is considering altering the FBI’s mission, transforming the legendary elite police agency primarily into a counterterrorism operation. But an FBI restructuring would impact more than the bureau itself. A shift in focus would mean a substantial reallocation of resources for the Justice Department and other federal agencies accustomed to relying on the bureau to do dirty, time-intensive work such as ferreting out drug rings or health care cheats. Right now, no formal restructuring plan is on the table. And a senior Justice Department official last week cautioned that decisions regarding the FBI’s priorities would be largely dependent on the budget resources provided by Congress. But already, the bureau, as well as the Justice Department, is feeling the strain. And it seems clear that with one-fourth of the FBI’s personnel now entirely engaged in terrorism-related investigations, some aspect of the FBI’s mission will have to be surrendered. Since the expansion of the classification of federal offenses in the 1990s, the bureau is responsible for investigating almost 300 separate violations of federal law, in everything from health care fraud to transportation of illegal refrigeration materials to tracking down deadbeat dads. “The FBI has got to get the running boards off of the Buick,” says former agent Clint Van Zandt, who profiled terrorists as part of his career with the bureau. “It needs to get rid of responsibility for all unsophisticated issues.” FBI Director Robert Mueller III, in a speech to the U.S. Conference of Mayors last week, seemed to agree. “We need to be able to look down the road five or 10 years and gauge what’s coming and start adapting now,” he said. LEANER AND MEANER Those adaptations will not come easy, and they certainly will come at a price. “The focus on terrorism is going to obviously be pursued at the expense of other areas which the bureau and the Justice Department traditionally pursued,” says criminal defense lawyer Robert Bennett, a partner at Skadden, Arps, Slate, Meagher & Flom. “But I think they are right. I would much prefer them to be pursuing terrorists than pursuing alleged health care violators.” The changes would profoundly accelerate the course the bureau has been taking for the past 10 years, a period that has seen its counterterrorism budget grow by sixfold to $600 million. The number of intelligence operatives in that time rose from 224 to 1,025. “This would be a major change, but not a fundamental change,” says FBI agent Nancy Savage, who heads the FBI Agents Association. “This train was already on the tracks.” As the bureau places an increased emphasis on counterterrorism and intelligence gathering, it has been given more tools to do the job. Legislation signed by President George W. Bush last week will allow the bureau to trace voice mails and e-mails across the nation, allow for greater sharing of intelligence with other government agencies and provide enhanced subpoena power. Already, a directive to agents nationwide on utilizing the weapons has been issued by FBI headquarters. But for the bureau, an even greater challenge lies in retraining and retooling the agency to operate in a complex global environment. The bureau has perpetually faced a shortage both in technology and in agents capable of foreign intelligence work. Before the Sept. 11 attacks, Freeh said scores of documents at the FBI headquarters were going unread because of a lack of trained investigators capable of deciphering them. And Mueller has put out an appeal for Arabic linguists. “They need more analysts, rather than more agents,” says Robert Litt, an Arnold & Porter partner who served as an associate deputy attorney general in the Clinton administration. “They can’t keep up with the intelligence they are getting now.” The bureau’s shortcomings in that area will further hinder any fundamental change in mission. “The FBI has demonstrated over a substantial period of time that it is an extremely capable law enforcement body,” says George Terwilliger III, a lawyer with White & Case who was a finalist for the FBI director job that went to Mueller. “In the eyes of some critics, and not without some cause, it’s seen as relatively less capable in intelligence gathering. I think some people will ask, ‘Why are we diminishing the law enforcement capabilities of the agency where they appear very capable, in favor of intelligence gathering, in which their reputation is not quite so good?’ “ MAKING DO A massive restructuring of the FBI would have an effect on the Justice Department, its parent agency, albeit a less dramatic one. The Justice Department is counsel of record for the federal government. Each year agencies are sued — by whistleblowers, victims of discrimination or harassment, and groups and individuals challenging federal policies or regulations. In those cases, by law and by necessity, the DOJ must defend the agencies. To that end, a spokeswoman for the Justice Department says that it has not significantly shifted resources within its walls since the terrorism investigation began. While the department’s leadership has been consumed with coordinating the massive probe, much of the operations of the 125,000-worker bureaucracy are unchanged. Lawyers from other divisions — Civil Rights, Antitrust, Tax, Environment and Natural Resources, to name a few — have not been reassigned. In just the past few weeks, for example, the department has indicted a Texas sheriff’s office on civil rights charges, filed suit to prevent a shipbuilding monopoly and settled a housing discrimination suit. “In the long term, the Justice Department has a variety of responsibilities which are never going to go away,” says John Boese, co-chair of Fried, Frank, Harris, Shriver & Jacobsen’s litigation department, and a former DOJ lawyer. “You are not going to take antitrust lawyers and make them terrorist experts.” In some cases, other agencies or law enforcement bodies can fill the void left by the FBI’s focus on counterterrorism. “You will see that the FBI as an investigator is largely out of the picture,” says Stuart Gerson, a partner at Epstein, Becker & Green, and former assistant attorney general for the Justice Department’s Civil Division. “The FBI is going to strip away some of the functions it already has. A lot of the drug stuff will be left to the [Drug Enforcement Administration]. A lot of the street crimes and bank robberies, they are going to deal with a lot less.” “Local police work robberies every day,” says former agent Van Zandt. “And the DEA is going to have to pick it up in the money laundering area. Customs is going to have to pick up more responsibility.” While no one expects the FBI to abandon its traditional pursuit of organized crime or political corruption cases, areas that have not been the favorite of FBI agents in years past will be probably be put on the back burner — pursuing deadbeat dads for child support payments, small-time drug criminals, small-scale fraud. State and local law enforcement will be expected to pick up on cases that the federal government might have pursued prior to Sept. 11. “I don’t think anyone should think this is carte blanche for white-collar criminals or the mob to do whatever they want,” says Sotiris “Ted” Planzos, an attorney with Troutman Sanders and former deputy chief of Justice’s Organized Crime and Racketeering Section. HEAL THYSELVES But the FBI will be of significantly less assistance to the Justice Department on matters such as white-collar crime, health care fraud or contractor malfeasance. And for those cases that the Justice Department continues to pursue, they will have to rely on other options besides G-men as investigators. “The Justice Department is going to have to beg, borrow and steal,” says Boese. “OK, so they can’t get postal inspectors, and they can’t get FBI agents, but they can go to another agency and borrow people from there. Or they ask the inspector general’s offices to beef up their staff.” Most federal inspectors general already have investigative staffs, with marshals that work on criminal investigations. The inspectors general for both the Defense Department and Health and Human Services are already significant players in combating fraud. The HHS inspector general worked 2,597 health care-related cases in 2000. “It will be up to the agencies to be the primary law enforcement” mechanism, says Richard Sauber, a Fried Frank attorney and former chief of the Defense Procurement Fraud Section at the Justice Department. The agencies themselves are confined to bringing purely administrative proceedings. Any criminal prosecutions would still have to be brought by Justice Department lawyers. In that sense, it is hard to envision a large-scale criminal investigation such as the one the government undertook of the health care giant Columbia/HCA Healthcare Corp. in the 1990s, which utilized hundreds of FBI agents over six states. “My practice will go from being 50-50 between criminal investigations and regulatory sanctions to almost 100 percent regulatory,” says Sauber. “These cases won’t go away. They will migrate.” Already, some Criminal Division lawyers within the DOJ have found it difficult to find FBI agents to assist with their cases. And an FBI spokesman concedes the possibility of an overstretched agency. “The government has limited resources,” he says. “That’s just a fact.” FBI agents currently are working six-day weeks, and even agents who are not assigned full time to the terrorist investigation are still participating. “You’ll work a bank robbery in the morning and work two terrorism leads in the afternoon,” agent Savage says. Savage says her membership would largely support a shift in mission for the bureau, which has seen its prestige slowly stripped away through a series of missteps during the last decade. “Our world has changed, and when that happens, we have to change,” she says. “I think we’re flexible enough to do it. We just want to make sure we are thoughtful enough when we do it.”

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